Sunday, December 16, 2012

Dealing With Scarcity

This article from the Greenville News reminds me of a reason I don't like the political control of economic goods, the difficulty in dealing with scarcity. 

The facts: certain schools in Greenville County are preferred over others--a common occurrence.  Greenville opted to conduct an open enrollment for these schools.  Preference would be given to those who were first in line.  The consequences were predictable: there was a race to get in line to apply.  At one school, the resource officer purportedly counted off the seconds before parents were allowed on campus:

" A parent said the school’s resource officer counted down the final seconds, lowered his arm and shouted, “Go!”At that, the parents sprinted across the driveway toward the school. One mother was “accidentally bumped” in the stampede, fell and suffered minor injuries. She was taken away in an ambulance and treated for “cuts and scrapes,” a school district official said."

Perhaps Greenville County will come away from this with the idea that the only problem is coming up with the best way to distribute these seats.  Unfortunately, there is no good way to distribute these seats satisfactorily, as any process will favor some over others.  Perhaps a lottery is most fair, but it by its very nature ignores need and best fit as criteria for selection.

Say what you will about the free market, but it solves the problem of scarcity pretty effectively.  Each dollar is a vote, and each vote is blind.  And if one loses a scarce good to another with more votes, one has incentive to create a competitive response.  


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